The Bank of Uganda (BoU) has announced new limits on over-the-counter cash withdrawals, capping daily withdrawals at Shs50 million for individual account holders and Shs250 million for corporate accounts beginning January 1, 2027.
The move represents a significant shift in Uganda’s payments landscape as the central bank seeks to accelerate the adoption of digital financial services, enhance transparency in financial transactions and reduce reliance on cash-based payments.
Under the new regulations, individual account holders will be permitted to withdraw a maximum of Shs50 million per day and Shs500 million per week. Corporate entities and businesses will be restricted to Shs250 million per day and Shs2.5 billion per week.
According to BoU, the restrictions will apply to all accounts held with supervised financial institutions. However, the limits will not affect transactions conducted through electronic payment channels such as Real Time Gross Settlement (RTGS) transfers and Electronic Funds Transfers (EFTs), which the central bank continues to promote as safer and more efficient alternatives to cash.
In a statement issued on Wednesday, the central bank said the decision was informed by changing consumer behaviour and the rapid growth of electronic transactions across the country.
“Digital payments continue to grow in volume and value, indicating that consumers trust and prefer their efficiency,” BoU said.
The central bank noted that electronic credit transfers have emerged as Uganda’s most widely used payment method, reflecting increased confidence in digital financial services among individuals, businesses and government institutions.
BoU acknowledged that certain sectors of the economy still depend heavily on cash transactions and announced measures aimed at ensuring that legitimate business operations are not disrupted by the new policy.
Under the guidelines, supervised financial institutions will be required to develop risk-based customer profiles that may allow for differentiated withdrawal limits based on the nature of a customer’s activities and transaction history.
Commercial banks and other regulated financial institutions will also have the option of seeking exceptional approvals from the central bank for customers, transactions or sectors that require larger cash withdrawals beyond the prescribed limits.
The regulator further directed financial institutions to actively encourage customers to adopt alternative payment channels, including RTGS, EFT and mobile money bank-to-wallet transfer services.
Analysts say the move is likely to have a significant impact on businesses and individuals that routinely conduct large cash transactions, particularly in sectors where cash remains dominant. At the same time, the policy is expected to accelerate the transition toward electronic payment systems and deepen financial inclusion.
The withdrawal limits form part of Uganda’s broader e-payments strategy, which aims to create a modern, secure and efficient financial ecosystem capable of supporting economic growth and digital transformation.
BoU said it remains committed to building an innovative, inclusive and resilient national payments system that supports Uganda’s socio-economic development goals while improving the efficiency, safety and accessibility of financial services across the country.